The insurance market has increased its focus on the effective use of TPAs because they are a proven option for reducing expenses and loss results. It has been recently published that a quality TPA can improve overall results up to four percent of a company's combined loss ratio. TPAs accomplish this primarily through specialization, a staff that can quickly concentrate expertise, and the general ability to maintain more efficiency in operations. Also, TPAs provide ancillary services to their clients that are not efficiently coordinated within an insurance company's internal resources such as, auditing, loss control, underwriting reporting, loss development and consulting. Overall, TPAs add to the bottom line equation by allowing their clients to remain competitive in the market place by reducing an array of costs while providing expert services.

FHA recognizes that success manifests itself through partnerships with is clients. FHA works side by side with its clients and potential clients through the program and product design, reinsurance placement and regulatory compliance processes prior to handling the very first loss. In addition to expert services that effectively manage ongoing programs, FHA works diligently to bring benefit to its clients and prospective clients through a wide range of ancillary services that can begin long before the activation of a program and can continue for some time after a program ends. On active accounts, FHA provides single point accountability with a dedicated unit concept which incorporates a working manager and a staff that is trained to the needs of a specific program/client on a 24 hours a day 7 days per week basis. This design provides enormous benefits to our clients.

FHA provides the answers for its clients to accurately understand its operational costs on active programs as well as cap it expenses in run-off scenarios. FHA develops a flexible fee structure with its clients that provides for the most manageable outcome for all parties. This can include a percentage of gross written premium and fee scheduling per occurrence. In the development of our fee structure FHA also presents the ability to provide a guaranteed pricing outline that can include the complete management of all allocated (ALE) and unallocated loss expenses (UALE).

Our future looks tremendous. We have enjoyed spectacular growth and fantastic success with our clients over the past several years. We have posted solid double-digit growth the past three quarters and are looking forward to even better results through the end of the year. We have answered the call from our clients and exceeded their needs by opening our regional office from coast to coast. Our controlled growth initiatives are continually evaluating more opportunities and researching further diversification of services to not only continue our growth but also to perpetuate our industry relationships. At FHA our future is about performance. Look for new offices, new partnerships and new services in the up coming year.